Saudi Gazette – The falsehood of ‘Peak Oil Theory’

Dr. Sami Al-Nuaim

In the last few years, there were several attempts from several non-specialized writers in the Saudi media to advocate for what is called “Peak Oil Theory” that wrongly predicts dark future for oil production.

This theory was introduced in the US after the oil embargo in early 70s by some bankers stating that when 1/2 of the oil reserves in any field is produced, the production will follow steep decline. This concept is based on a probability theory that is not linked to any scientific facts or physical laws that govern oil production in oil reservoirs.

In addition, what makes this theory completely false is the fact that it totally ignores the impact of technological advancements in increasing the recovery factor and the probability to find new oil discoveries.

History proved that despite the increase in global oil demand which was 100 percent met by the market through increasing global oil production, the OPEC and non-OPEC countries had indeed increased their oil reserves by more than one fold.

Other main oil producers such as Saudi Arabia had maintained its oil reserves in the last 20-plus years despite its high production, by adding new discoveries and deploying advanced technologies that significantly increased its field recovery factor to 50 percent – the highest in the world.

As we all know, the Saudi oil reserves are maintained for long time at a figure close to 260 billion barrels which makes the current age of the Saudi oil to more than 70 years at a production rate of 10 million barrel per day.

This is of course assuming that Saudi Arabia will not discover new fields and will not develop and/or deploy new technologies to increase the current 50 percent aggregate recovery factors (which we know is impossible to happen).

Other OPEC countries such as Venezuela has increased their oil reserves several folds due to advancements in technologies that increased the recovery factor of their heavy oil.

Also several non-OPEC oil producers such as Norway, Canada and Brazil had significantly increased their oil reserves due to new advancements in intelligent field, deepwater exploration and production and oil sand technologies, respectively.

The advocators of this false theory said that the world will reach the Peak Oil in the 80s, then this was changed to the 90s, 2000, 2010, and now in 2025!!!!

Although scientifically and historically the basic of this theory was proved to be wrong, its estimate of the time at which the world will reach the Peak has been a moving target. Moreover, the oil industry had proven and will continue to prove that this is indeed a moving target as an indication of its falsehood.

—    Dr. Sami Al-Nuaim is a Saudi writer and can be reached on Twitter: @neaimsa. His articles can be read at www.saudienergy.net

Saudi Gazette

6 Comments on "Saudi Gazette – The falsehood of ‘Peak Oil Theory’"

BillT on Sat, 20th Apr 2013 1:16 am 



Ah yes, the major liars of the oil industry and we are to believe them now because…? After all, they contributed the people, and probably the money, to accomplish 9/11.

Ham on Sat, 20th Apr 2013 10:47 am 



As from 2012 World oil production/exploration expenditure was $1 Trillion. Additionally 60% of World oil comes from 1% of oil fields. These are Elephants, giants with 500+ million barrels. The decline rate for these, is at minimum 6% per year, mostly they are between 40-50 years old, some are even older. Therefore, despite media hype it is almost irrelevant how many millions come from; deep sea, fracking or the Arctic (which incidently is not going to happen anytime soon). It is pretty obvious that there are going to be severe shortages of World oil production in the very near future, despite attempts to maintain the fiction of a continual bonanza.

Others on Sat, 20th Apr 2013 2:17 pm 



Conventional Oil production has already hit the peak of around 74 million barrels/day and last year, it has declined to 70 million b/d.

Only the shale oil, heavy oil, tar sands are coming to market and the heavy oils need lot of natgas as diluent.

Yes OPEC said that $25/barrel was a fair price in 2000, then they bumped it to $45, then $75 and now $100/barrel.

Their next stop is $130/barrel.

Boston Commons on Sat, 20th Apr 2013 2:33 pm 



This dude is spot on in his criticism of the doom and gloomers of peak oil. Fortunately most peakers are smarter than the doomers, and understand that peak oil only means that the days of cheap oil are over.

Newfie on Sat, 20th Apr 2013 7:35 pm 



Oh good. Oil production will continue to increase forever. I’m going out right now and buying a 6 liter Hummer and blasting off down the free-way. ROTFLMAO. Dr Sami Is-an-idiot.

ralfy on Fri, 3rd May 2013 9:03 am 



The presence of a “target” actually proves peak oil. The fact that it moves in either direction doesn’t disprove its existence.

Also, Saudi Arabia boasted back in 2009 that they would easily increase production to 15 Mb/d by 2011.